STRICT rules imposed by the European Union could force UK-based banks to relocate more staff to the bloc after Brexit than originally planned, a top banking CEO has warned.

Brexit news: UK-based banks could be forced to move more staff to the EU (Image: GETTY IMAGES)

The European Central Bank (ECB) and regulators in Germany have become increasingly strict in their demands for some banks looking to do business in the bloc, Tracy Clarke said.

The regional CEO for Europe and the Americas for Standard Chartered said officials in the EU had “toughened” their stance as her firm attempts to secure a license to turn its Frankfurt branch into a subsidiary.

Dozens of major banks and financial institutions are making plans to relocate part of their operations to Europe after Brexit to ensure they maintain ‘passporting’ rights which allow them to do business freely with EU member states.

Germany, particularly Frankfurt, has been tipped to attract many of the jobs from London as the city is already home to the ECB headquarters.

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"But if they're taking this approach with all other banks who are much bigger than we are in terms of their European business, that could be more significant.”

Ms Clarke said Standard Chartered had applied for its subsidiary license nearly nine months ago but the permit has still not been approved.

"Because we were one of the first (to apply for a licence) there was no precedent for us, or for them.

"It's been a learning process on both sides."

The ECB says it is aiming to prevent banks from setting up so-called 'brass plate' operations (Image: GETTY IMAGES)

While dialogue with German regulators and the European Central Bank (ECB) has been "very constructive", Mrs Clarke said they have become increasingly strict.

"They're getting firmer about what they expect to see, and their stance is therefore becoming a bit tougher actually.”

The ECB said its new licensing process is aimed at preventing banks from exploiting gaps in the rules.

It said in a statement: "The ECB is keen to prevent banks from creating empty shells when granting licences to international banks setting up new subsidiaries in the euro area in the context of Brexit.”